Death and taxes

Does the extended 20-year limitation period have a criminal nature?

In June 2010 Mr Wood admitted to underdeclaring income for the years 2002-03 to 2007-08. He intended to use HMRC’s tax health plan disclosure opportunity but did not submit a report by the deadline. HMRC therefore issued discovery assessments to collect the outstanding tax. In addition it raised assessments going back to 1992-93 under TMA 1970  s 36 and imposed penalties.

In April 2013 Mr Wood appealed but he died a month later. HMRC cancelled the penalties but the deceased’s advisers decided to proceed with the appeal against the assessments.

They argued that it was impossible in view of the taxpayer’s death for there to be a fair trial on the issue of whether he deliberately underdeclared his income. They invoked the European Convention on Human Rights article 6 ‘right to a fair trial’.